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NEW QUESTION: 1
Shirley Riley, CFA, has just been promoted, from vice president of trading to chief investment officer (CIO) at Crane & Associates, LLC (CA), a large investment management firm. Riley has been with CA for eight years, but she has much to learn as she assumes her new duties as CIO. Riley has decided to hire Denny Simpson, CFA, as the new compliance officer for CA, Riley and Simpson have been reviewing procedures and policies throughout the firm and have discovered several potential issues.
Communications with Clients
Portfolio managers are encouraged to communicate with clients on a regular basis. At a minimum, managers are expected to contact clients on a quarterly basis to review portfolio performance. Each client must have an investment policy statement (IPS) created when their account is opened, specifying the objectives and constraints for their portfolio. IPSs are reviewed at client request at any time. Any time market conditions dictate a change in the investment style or strategy of a client portfolio, the client is notified immediately by phone or email.
Employee Incentive Program
CA offers several incentive programs to employees. One of the most popular of these programs is the CA IPO program. Whenever CA is involved in an initial public offering (IPO), portfolio managers are allowed to participate. The structure is simple-for every 100 shares purchased on behalf of a client, the manager is awarded five shares for his own account. The manager is thus rewarded for getting an IPO sold and at the same time is able to share in the results of the IPO. Any¬time shares are remaining 72 hours before the IPO goes public, other employees are allowed to participate on a first-come, first-serve basis. Employees seem to appreciate this opportunity, but CA does not have exact numbers on employee participation in the program.
Private Equity Fund
CA has a private equity fund that is internally managed. This fund is made available only to clients with more than $5 million in assets managed by CA, a policy that is fully disclosed in CA's marketing materials.
Roughly one-third of the fund's assets are invested in companies that are either very small capitalization or thinly traded (or both). The pricing of these securities for monthly account statements is often difficult. CA support staff get information from different sources-sometimes using third party services, sometimes using CA valuation models. In some instances, a manager of the private equity fund will enter an order during the last trading hour of the month to purchase 100 shares of one of these small securities at a modest premium to the last trade price. If the trade gets executed, that price can then be used on the account statements. The small size of these trades does not significantly affect the fund's overall position in any particular company holding, which is typically several thousand shares.
Soft Dollar Usage
Several different managers at CA use independent research in developing investment ideas. One of the more popular research services among CA managers is "Beneath the Numbers (BTN)," which focuses on potential accounting abuses at prominent companies. This service often provides early warnings of problems with a stock, allowing CA managers the opportunity to sell their clients' positions before a negative surprise lowers the price. Stocks covered by BTN are typically widely held in CA client accounts.
Managers at CA have been so happy with BTN that they have also subscribed to a new research product provided by the same authors-"Beneath the Radar (BTR)." BTR recommends small capitalization securities that are not large enough to attract much attention from large institutional investors. The results of BTR's recommendations are mixed thus far, but CA managers are willing to be patient.
As they discuss these issues, Riley informs Simpson that she is determined to bring CA into full compliance with the CFA Institute's "Asset Manager Code of Professional Conduct." The following questions should be answered with the Asset Manager Code as a guide.
Indicate whether CA's policies related to investment policy statement (IPS) reviews and notification of changes in investment style/strategy are consistent with the Asset Manager Code of Professional Conduct.
A. Both policies are inadequate.
B. The IPS review policy is adequate, but the policy on communicating changes in style / strategy is inadequate.
C. Both policies are consistent with the Asset Manager Code of Professional Conduct.
Answer: A
Explanation:
Explanation/Reference:
Explanation:
The IPS review policy is inadequate. It is good that IPS are reviewed at any lime upon client request, but it is also likely that clients may be unaware of when such a review might be appropriate. It is incumbent upon the manager 10 initiate a review of the client's IPS. The Asset Manager Code recommends such reviews on an annual basis, or whenever changes in client circumstances justify them. The notification of changes in style/strategy is also inadequate. Such notification should be made in advance, so that the client has time to consider the change and react accordingly. (Study Session 2, LOS 6.b)
Topic 6, Corporate Finance

NEW QUESTION: 2
After the initial installation the First Time Configuration Wizard should be run. Select the BEST answer.
A. Connection to the internet is required before running the First Time Configuration wizard.
B. First Time Configuration Wizard can be run from the command line or from the WebUI.
C. First Time Configuration Wizard can be run from the Unified SmartConsole.
D. First time Configuration Wizard can only be run from the WebUI.
Answer: B
Explanation:
Check Point Security Gateway and Check Point Security Management require running the First Time Configuration Wizard in order to be configured correctly. The First Time Configuration Wizard is available in Gaia Portal and also through CLI.
To invoke the First Time Configuration Wizard through CLI, run the config_system command from the Expert shell.

NEW QUESTION: 3
DRAG DROP

Answer:
Explanation:


NEW QUESTION: 4
Which are two requirements for AToM support? (Choose two.)
A. MPLS must be configured with an LSP in the SP core.
B. MPLS must be enabled between the PE and CE routers.
C. Cisco Express Forwarding must be disabled.
D. The PE routers must be able to communicate with each other over IP.
E. IP routing must be configured between the PE and CE routers.
Answer: A,D


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